In December 2016, the Federal Open Market Committee (FOMC) raised interest rates for the first time in a year, and then raised them again in March 2017. Federal Reserve Chair Janet Yellen indicated that the Fed could raise interest rates even further later this year. But what do rate hikes mean for advisors, their clients and investment portfolios? When interest rates increase, bond prices decrease. And while many analysts expect equities to suffer when interest rates go up – which is what many had predicted for markets in 2016 – these more recent rate hikes have not taken the wind out of the U.S. stock market’s sails. Lately, it seems that when rates rise, the value of equities doesn’t take a hit. But there’s no telling how long this trend will last. (For more, see: Fed Increases Interest Rates at March Meeting.) It’s important to keep in mind that when the market suddenly increases or decreases due to the influence of political, civil, or economic forces, then a market correction will happen soon. Due to the high probability of this event occurring, the author encourages the investor to have a financial advisor to consult with to make sure that his or her investment strategy and portfolio is ready to handle this change. Although advisors can’t predict what is going to happen in the stock market and how it will react to future interest rate hikes, they can take measures to ensure their clients benefit from rising interest rates while taking all potential risks into account. In a simplified example, let’s say a client is a balanced investor which usually means a portfolio is a 60/40 mix of equities and fixed-income investments (such as bonds). In a declining interest rate environment, the asset allocation may be 60% fixed income and 40% equity to take advantage of rising bond prices. In a, rising interest rate environment, the allocation can flip to 60% equities and 40% fixed income to benefit from bullish equities. The client’s risk tolerance always remains intact and slight adjustments are made to take advantage of stock market movements. (For more, see: The 4 Most Important Effects of Rising Interest Rates.) A well-diversified portfolio can hold both domestic as well as foreign investments, but how do rising interest rates affect foreign exchange? If $1 USD equals $1.35 Canadian dollars, the U.S. dollar is stronger. This means it’s not a good time to exchange Canadian money into U.S. currency because Canadians will only receive $0.65 USD for every Canadian dollar exchanged. However, it would be a good time for Americans who want to invest in Canadian currency to take advantage of the foreign exchange while the dollar is strong. When investing in any foreign currency, it’s important to remember to buy low and sell high. This basic strategy doesn’t consider a continuous cash flow, so you must balance this strategy against your cash flow principles. Even the author doesn’t recommend trying to time the market to make a quick return, because what you’re doing is basically gambling.

For many, a six-figure salary is the endgame, the true sign that you’ve made it in life. But, among those who top lists like the Forbes 100, a six- or even seven-figure salary is pocket change, just another step toward true riches. If you’re raring to dial up your earnings and be among the world’s richest, you’ll need to emulate the habits and accomplishments of the wealthy. Here’s how you can get started. The seven steps are: start and commit to your business, make smart investments, invent a solution, pursue your passion, take action, collaborate, and adopt a billionaire mentality. On the Forbes list, most of the billionaires are business owners that scaled their business to make a global imprint. It’s important to take risks, but with a full commitment to your business model and philosophy. You must have a vision that will help as many people as possible for as many generations as possible. It’s important to make smart investments not only in assets but also in the greatest asset you have, yourself. Sometimes, the best inventions are not original but instead innovations or improvements on existing products. A prime example of innovation comes from billionaire businessman Sam Walton, who opened the first Walmart in 1962. What made Walmart an innovation was the idea that the business could expand enough to sell products to consumers at lower prices than other retailers, saving them money on basic necessities. This basic premise transformed the way America shopped, while making Walmart one of the biggest retailers in the world — and Walton one of the richest men. It’s important to pursue your passion, but it’s even more important to put that passion into action. I’ve talked to some aspiring business owners and they can’t seem to gain any traction in their business because they don’t have the necessary commitment to act on their passion. It’s important to collaborate, because essentially no man is an island. You’ll need a team to build a business, so why not have a co-founder? A co-founder who both compliments and challenges your points of view but ultimately has your vision at heart. Rich people have a rich mentality, according to Steve Siebold, author of “How Rich People Think.” He has interviewed over 1,200 of the world’s wealthiest people to uncover the secrets to becoming rich. “While the masses believe becoming wealthy is out of their control, rich people know that making money is really an inside job. It’s a cause and effect relationship,” he wrote on Business Insider. “Anyone can become wealthy. It has nothing to do with your education or where you come from. It’s not what you do that guarantees wealth, it’s what you are.” So, focus on making things and crafting solutions. Create new products, improve current products and help people. But most importantly, be resilient and keep pushing forward